Rising demand for dollars “is affecting our dollar-sale auction,” Salih said. “This isn’t in the interest of the Iraqi economy and it will suck foreign currency reserves ... A lot of money in dollars and also deposits which are supposed to be invested in Iraq are being exchanged to U.S. dollars to fund the trade in neighboring countries.”
Foreign exchange reserves in Iraq, holder of the world’s fifth-largest crude deposits, touched $60 billion this year, the most in its history, he said.
Salih added that the central bank will cut three digits from the currency in 2013, reversing a policy it introduced in the 1980s to address the government’s budget deficit.
The yield on the country’s six-month treasury bills fell 1.1 percentage points to 8.2 percent at the last auction on Dec. 13, according to data compiled by Bloomberg, the lowest yield since August 2010. With yields above 8 percent, Iraq has no plan to issue sovereign bonds this year, the deputy governor said.
(Source: Bloomberg)
This will be interesting since Iran is playing a role with the oil issues... I noticed Iraq's bankers are talking about cutting zeros still..